Offshore Drilling Giacomo Rimoldi Gutierrez CBE 555 October 2, 2007.
CBE 555 Presentation Modified by Jon Konen Originally by Joel Thomas March 10, 2008.
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Transcript of CBE 555 Presentation Modified by Jon Konen Originally by Joel Thomas March 10, 2008.
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CBE 555 Presentation
Modified by Jon Konen
Originally by Joel Thomas
March 10, 2008
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What’s on Tap?Market Trends
Market Growth & Comparative MarketsFinancial AnalysisMyths dispelled
Reason (given) to believe Safety Quality Purity
Environmental ImpactFiji case studySource problems
Disturbance of Delicate EcosystemsAlternativesConclusions
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Market Trends
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Changes in U.S. Consumption Over 5 Years
U.S. BOTTLED WATER MARKET
Volume and Producer Revenues 2002 – 2007(P)
Millions of Annual Millions of Annual Year Gallons % Change Dollars % Change 2002 5,795.7 -- $7,901.4 -- 2003 6,269.8 8.2% $8,526.4 7.9% 2004 6,806.7 8.6% $9,169.5 7.5% 2005 7,539.1 10.8% $10,007.4 9.1% 2006 8,253.0 9.5% $10,980.0 9.7% 2007 (P) 9,075.0 10.0% 11,905 9.6% (P) Preliminary
Source: Beverage Marketing Corporation
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FinancialTypical Price Standardized
PriceW.W. Bottled Water Consumption
yearly
Tap Water $1.52/HCF* $0.000357/L 89 billion L/yr $32 million
Bottled Water
$1.00/Liter $1.00/L 89 billion L/yr $89 billion
*HCF = Hundred Cubic Feet
Difference $88.97 billion
Factor 2800x more
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Why do people drink bottled water?Alternative to other beverages
TrendyLuxuriousConvenience
Worries about tap water“Bottled water is purer.”“Bottled water is just safer.”
Differently regulated (see regulation slide) Hype, myth, and propaganda
Perception of difference“Bottled water tastes better.”
Placebo effect Caters to different “tastes” (preferences)
Bottled water is better than tap water 3 out of 4 cases, it is tap water
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Brand SourceAquafina Pepsi bottling plants
Dasani CocaCola bottling plants
Yosemite Waters Los Angeles, CA
Alaskan Falls Worthington, OH
Everest Corpus Christi Texas**Listed on the bottleSource: Corpus Christi Municipal Water Supply
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Healthier?Myth: BW is healthier than tap water Truth: BW not regulated to check for parasites and certain
other microbes.See regulations slide (next)
Myth: Water bottles leak carcinogens into water if you reuse bottles.
Truth: Bottled Water (BW) does have an expiration date. Extended exposure to heat and light leeches plasticizers and
terephthalates into water.However, infinite shelf life when stored under optimum conditionsEnough to kill?
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Re-using Plastic BottlesBottles do not leak carcinogens over short time that are
harmfulBacteria can grow in the bottles due to trace amounts of
water left behind when sitting for several daysCleaning and sanitizing bottles after 1-2 days of use
eliminates bacteria makes bottle safe againNothing from the bottle is cause of sickness, bacteria that
grows from water left in the bottle.
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Safer? - Regulation of waterTap water – EPA Regulated
Purity requirements – more limitations than FDABottled water – FDA Regulated
Standards of identity – Must ensure truth in advertising = declare your source Final product must be at least as pure as source
% Total Dissolved Solids (TDS) in mineral water Sparkling water may have no more CO2 dissolved than source
May remove and replace up to limit
Limits on Chemical, Microbial, and Radiological Contamination
But… No test for Parasites, E. Coli, Cryptosporidium, Giardia No test for Asbestos No test for Organics such as Benzenes
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Regulation IssuesComprehensive database at www.ewg.org for
contaminants in public tap waterNo database/ information for contaminants in bottled
water.Claims of purer water
Ohio State study of 57 bottled water samples, 15 had higher bacteria contents than tap water
Others were “more pure” than tap waterAll were deemed safe to drink
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Tastes Better? - PerspectivePenn and Teller (Showtime fame) – Fooled customers at a
San Francisco Restaurant with bottles of water filled from the restaurant’s tap
Customers thought it tasted better and was more fancy than tap water
Taste test using New York City water and 5 name brands, NYC water tied for 3rd with water from Iceland.
Last place – Evian (most expensive), First place – K-mart brand water
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Limitations of FDA RegulationLoophole: regulates only BW for interstate commerce
Reliance on state regulation “The FDA relies on state and local government agencies to approve
water sources for safety and sanitary quality” 1 in 5 do not regulate
Unequal protectionDevotion of half of time of one FDA inspector for every 100 EPA water
quality inspectors Low priority for inspection under General Food Safety Program Reliance on voluntary declaration of violations
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Environmental ImpactSolid Waste
Effective recycling rate = 34.1 % Recycling problems
FDA regulations food surfaces materials = one
time use Saturation of market for recycled
PETTotal waste mass
998 million tons/yr
Uses mass amounts of gasoline and oil to ship water across the country and around the world.
Poly(Ethylene Terephthalate)
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Water Resource ImpactWater resources
Privatization of water Water rights Ethical issue
Especially in third world and water-poor countriesSource Depletion
Damage to delicate ecosystems Coastal land drilling – salt water intrusion damages soil quality Spring water – can drain streams and riverbeds miles away
Question of water rights Ground water – common source of well water
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Carbon ImpactFiji Case Study: One bottle of Fiji Water
CO2 emissionsProduction in China – 93g (3x mass PET)Transport to Figi – 4gTransport of filled bottles to US – 153g
Total Impact: 250g CO2/bottle
Energy cost of PET production, filling and transportation is equivalent to filling each bottle
¼ full of oil.Price to consumer - $2.50/bottle
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Alternatives to Bottled WaterConsumers say bottled water is convenient
Use Nalgene or other reusable bottle and bring with youContainers must be cleaned regularly to prevent bacterial
growth. May be cleaned hundreds of times.Public water fountainsPurifying with Brita and other filters if worried about
quality
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ConclusionsBillion Dollar IndustryCharging exorbitant prices
Marketing and hypeUsing existing technology and equipment
Often already paid for with tax dollarsGenerating culture of distrust, disposability and wasteAlternatives: Nalgenes and other washable safe containers
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Questions?When will the growth of bottled water slow down?With increasing use in developing countries (India,
China), will cost of water continue to rise?Water quality is heavily regulated in the US, should
municipalities be selling their water for profit versus large corporations paying fractions of cents to sell for 2800 X profit?
How long until FDA imposes stringent standards on bottled water?
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Sourceshttp://www.epa.gov/http://www.cfsan.fda.gov/~dms/botwatr.html
(FDA/CFSAN website)
http://www.nrdc.org/water/drinking/ National Resources Defense Council
http://www.bottledwater.org International Bottled Water Association
http://www.epa.gov/msw/facts-text.htmhttp://www.epa.gov/safewater/faq/faq.htmlhttp://www.pubmedcentral.nih.gov/articlerender.fcgi?artid=1693287http://en.wikipedia.org/wiki/Bottled_waterhttp://www.jewishworldreview.com/0505/stossel051805.php3www.bottledwaterweb.comhttp://www.cnn.com/2007/HEALTH/07/27/pepsico.aquafina.reut/